Aside from developing products and enhancing customer service, small business owners should never overlook the welfare of their employees. Employee retention is vital in any small business. In fact, in a small venture with only 5 to 10 employees, a loss of one or two people could be devastating. Aside from disrupting production and affecting customer service, it could be harder and costlier to train new employees. And of course, losing one or two could affect the morale of others who could also follow suit. This is unless employee retention is prioritised.
So what are the three Rs?
Recruit is all about hiring the best employees for the job. No matter what type of industry you are in, your small business deserves to hire skilled, talented and hardworking employees who can do the job assigned to them. It all boils down to using an effective recruitment strategy that will help you pick from a pool of applicants.
Be clear about your job description and from this, take cues on the characteristics and skills that your future employees must possess.
Engage the best talent, not only those that are actively looking. The vast majority of people are passive candidates but they are open to the right opportunities.
Administer a test and an interview to find out more about your candidates. You need to be clear whether you’re recruiting someone fully qualified for the role or someone who will require some training and guidance. You are not only looking for someone with the right skills but who will enjoy working in your organisation.
Having market intelligence as well as a good understanding of where your organisation sits in relation to the market is essential when considering how to reward your employees. This will enable you to recruit new employees at the right salary and ensure you are rewarding your existing employees appropriately in order to retain your key talent.
A reward strategy helps you determine the right reward programmes for the strategic direction of your business and your unique work culture. A number of research studies have shown that organisations with a defined reward strategy and engaged employees have higher levels of financial performance.
The 4 components of reward you should be considering are:
Competition for critical talent is starting to heat up and employers are realising that traditional workplace practices are increasingly inadequate to meet the needs of a technologically mobile and digitally connected workforce. A small business’s culture can suffer a serious blow when an important person leaves and often they may be the only ones possessing a particular skills or knowledge set.
Clearly it is inevitable that some employees will leave your organisation from time to time and a certain amount of employee turnover can be healthy to keep the business vibrant. However, in order to formulate a retention strategy, you must gather information on turnover rates, turnover costs and have a clear understanding of why people are leaving the organisation. This will determine whether you need a broad based approach directed at the entire population or a more targeted approach.
Ultimately, there needs to be a holistic and strategic approach to HR where your leaders feel empowered and there is a genuine feeling of togetherness and team spirit. This will inevitably attract new talent, make existing employees feel rewarded and ultimately help retain key people.
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